P2BInvestor

Peer-to-business crowdlending platform P2Binvestor (P2Bi) has launched a bank partnership program today. The new initiative will offer small-to-medium businesses (SMBs) working capital while providing banks access to a diversified asset class.

Under the partnership, banks will front 50% of the capital with a senior secured position. P2Bi’s base of private investors will provide the remaining half of the capital and businesses will receive the funds with a blended interest rate of 8% to 12%. By partnering with P2Bi, banks can quickly extend multi-million dollar lines of credit to growing SMBs and establish a lending relationship with them at an early stage in their business development.

The Colorado-based company’s CEO Krista Morgan explained that regulatory and technology hurdles have made it difficult for business borrowers and banks to connect. “Until now, there hasn’t been a solution like this, which unfortunately has forced growing companies to take on expensive and time consuming funding,” Morgan said. “We’re enabling banks to lend to businesses they otherwise wouldn’t be able to due to strict lending standards,” she added.

Piloting the bank partnership program is New Resource Bank, a San Francisco-based bank with $331 million in assets under management and a focus on social, environmental, and economic change. “P2Binvestor is excited to be powering New Resource Bank’s line of credit with both our marketplace and proprietary receivables lending platform,” said Morgan.

Vincent Siciliano, president and CEO of New Resource Bank describes the program as a “win-win” for the bank and for businesses. Siciliano said, “By using P2Bi’s platform, growing businesses will be able to secure capital that they typically wouldn’t be able to access through bank lending alone. This allows us to offer a greater suite of lending products to the community of sustainable businesses we serve.”

Founded in 2012, P2Bi debuted at FinovateSpring 2013 and, at FinovateFall 2014, the company showcased its borrower application and loan management platform. In November of 2016, P2Bi closed a $7 million Series A round, bringing its total equity funding to $9.6 million. Last month, Forbes featured the company in an article titled, “When Venture Capitalists Said, ‘No,’ This Woman Didn’t Give Up.”

Small business marketplace lender P2Binvestor announced $7.7 million in new funding, courtesy of a Series A round led by Rockies Venture Club (RVC). Also participating in the Series A was Japanese venture capital firm, Future Venture Capital Co. (FVC). The investment in P2Binvestor was FVC’s first direct investment outside Japan.

P2Binvestor founder and CEO Krista Morgan said that her company was filling a significant niche for SMEs seeking financing to grow. “We’re seeing more interest in our model as venture funding hits a two-year low and more entrepreneurs are looking for ways to grow their business—while preserving their equity—by using good-quality, flexible debt,” Morgan said. She added that the new capital will be invested in technology as well as sales and marketing “as we scale to meet market demand.”

Headquartered in Denver, Colorado, and founded in 2012, P2Binvestor demonstrated its new borrower app and loan-management dashboard at FinovateFall 2014. The company specializes in providing asset-backed lines of credit, using the crowdlending format to connect both accredited and institutional investors with small businesses needing funding, and using the latest in technology to streamline the underwriting process and provide due diligence for investors. In September, P2Binvestor won the finance and banking PowerBook award from the Denver Business Journal, and extended a $10 million credit facility with Urban Settlement Solutions.

P2Binvestor has funded more than $350 million in revolving credit to more than 80 SME borrowers since the spring of 2014. The company hopes its crowd of 150 accredited retail and institutional investors will help P2Binvestor fund an additional 112 new borrowers by March 2017. P2Binvestor anticipates more than $8 million in revenue this year and expects to be cash-flow positive in 2017. The company’s average line of credit is $1 million.